Insights

21/08/15

Consultation on AUSTRAC industry contribution

AUSTRAC has invited stakeholders to make submissions on the proposed arrangements for the 2015-16 industry contribution levy.

Background

As part of the 2014 Federal Budget, the Australian Government announced it would replace the cost recovery arrangements administered by the Australian Transaction Reports and Analysis Centre (AUSTRAC) (the supervisory levy) with an industry contribution levy to fund AUSTRAC’s regulatory and financial intelligence functions. The industry contribution levy became effective from the 2014-15 reporting period and leviable entities were invoiced during April 2015.

What is the industry contribution levy?

The industry contribution is calculated as a percentage of AUSTRAC’s operating costs, including amortisation and depreciation costs of assets used by AUSTRAC. For the 2015-16 reporting period, 90% of AUSTRAC’s operating costs will be payable from the industry contribution levy. This is an increase from 70% payable in the 2014-15 reporting period.

The amount payable by reporting entities is a calculation of a reporting entity’s annual earnings (“earnings component”) and reporting activity (“reporting component”) as at the census date. Both components, and the total amount payable, are subject to thresholds (see below).

A key benefit of the industry contribution levy is to reduce the regulatory burden on small businesses. AUSTRAC estimates only 5% of reporting entities will trigger the threshold requirements to contributing to the levy.

Current consultation

This month, AUSTRAC has made available its Industry Contribution Stakeholder Consultation Paper for public comment. The paper outlines AUSTRAC’s proposed changes to the calculation factors which were used to determine the amount of the 2014-15 levy.

Broadly, AUSTRAC does not propose to make any changes to the underlying structure of the charging model that was used from the 2015-16 reporting period, however some changes will be made to the calculation factors in order to reflect the increase to the percentage of AUSTRAC’s operating costs that will be covered by the levy.

Overview of changes

Below is a summary of the proposed changes to the charging model, which is subject to the information submitted to AUSTRAC on the census date for the 2015-16 reporting period.

What this means for reporting entities

The census date for the 2015-16 reporting period is 14 September 2015. AUSTRAC expects to issue invoices in October 2015. Reporting entities should ensure their details on the online business profile are up to date as this will determine whether or not an entity is a leviable entity and receives an invoice.

Categories

Share This

Related Insights

The Bill extends the corporate whistleblower regime in the Corporations Act and creates a whistleblower regime in the Taxation Administration Act 1953 (TAA) for disclosures of information by individuals regarding tax law breaches or misconduct relating to an entity’s affairs.

Australia generally welcomes foreign investment. The Foreign Investment Review Board (FIRB) screens certain foreign investment proposals on a case-by-case basis to determine whether a particular proposal is contrary to the national interest. This brochure explains some of the rules governing the screening process through FIRB.